nickshanagher

Two quick stories on achievement. Don Fisher, who died this week, founded Gap in San Franciso, with his wife Doris, because he had an idea that he could make it easier to buy a pair of jeans. It was 1969 and he was 41 and his business went from one shop to 3,100 and sales of $14.5bn. In addition to having a neat idea, he also hired some great people. Will Adderley, whose parents set up what has become Dunelm, the 97 outlet and growing soft furniture chain, says his company is successful because it retains the values of a small business: cost control, tight recruitment and a focus on the core customer. Dunelm is 10 years younger than Gap but is now being talked about as a competitor to John Lewis. It may be that our businesses will never grow like these but we need to take inspiration from the success of these family businesses. When you get up every morning, be optimistic and think about how you will make your business work better for your shoppers.

How hard: it depends how big you are and how much you know about your customers. For a large multiple, a huge amount of science goes into developing deals for their shoppers. They try to deliver promotions that are timely and targeted. They have complex buying, marketing and merchandising operations to keep synchronised. For a local shop, you can see the customer you want to focus on and you can ask them what they are looking for. Next you can source the deal and then deliver it on time in your one location. However, if you want to maximise the investment of suppliers in your promotion, then you need to impose greater discipline. If you want to earn overrider payments, you have to take promotions designed for the average shopper, not your own customers. If you choose to step up a level, then you need to improve your own disciplines. The first thing you need to do is tell yourself that you will have regular promotions. Perhaps 13 times a year, perhaps more. Some could be obvious...

In my business, we have started our 2010 budget process and no-one is happy about having to put words and numbers on what they think will happen next year - and still do their day jobs! As a publishing company that serves independent retailers, our success is linked to two things: the need for local shopkeepers to find out what is going on and to act on it; and the willingness of major suppliers to invest in the independent channel. At some point, both depend on the willingness of shoppers to visit their local shops and spend money. Therefore I am always keen to read what the major groups are saying about the future and two leaders of major UK quoted companies were offering their thoughts last week. Obviously, they are talking up their current performance and warning of trouble ahead because the indicators for the UK economy are still weighted to the down side rather than the up side. Justin King of Sainsbury says that today's shopper is "coming out of their shell a bit...

The Somerfield shop in my village has started to share co-branding with the Co-op, which bought the chain earlier this year. A pair of workers, one wearing Somerfield attire and one Co-op, hug each other in the bottom left hand side. Co-op point of sale now appears instore, clashing slightly with the fixtures. At the counter I ask the assistant if they are going to have the membership cards. This lady is not hugging anyone. I don't know, she says. They don't tell us anything. Next to this shop we have a One Stop, which is owned by Tesco but not branded in any way, shape or form. They share a car park, which is convenient, and shoppers can quickly walk from one to the other if either is out of stock. This weekend, I was in need of a certain brand of tonic water. The own label in the Co-op was not what I wanted. One-stop only stocked the slimline version. I asked the assistant there if this was always the case. She fixed me with a steely look and answered me by saying th...

Kevin Jones, who runs a shop in Hawarden, Clywd, has identified another tricky detail when the VAT rate jumps back up 2.5% to 17.5% in January: price-marked stock. In particular he is thinking about tobacco products, where the margins are already thin. Obviously, stock management from now to December will need to be good. Cigarettes are a product with a relatively high stockturn (you need to be sure that you sell through all your price-marked stock), which means that planning your buying ensures you avoid problems. Risk management requires planning ahead and attending to the detail so that you avoid losses. It doesn't increase your wealth but it simply has to be done.

The October 2009 issue of Which, the consumers' bible, provides a helpful double page diagram revealing 10 secrets of how supermarkets position goods to make shoppers buy more. There will be no surprises for a local retailer who is paying attention but the simplicity of the presentation is useful in thinking about how well you are executing your strategy in-store. "Look right" is tip number six, saying: "Most of us look right when we enter the shop - so that's where supermarkets put current deals...[which] can be brought out at a moment's notice - if it starts raining heavily, you may see umbrellas appear hear". If your layout will not accommodate a 'deals zone', you should still pay attention to what shoppers see when they look right - this will set the tone for their visit. (Also note the presumption to action, with the best stores being able to quickly change their displays and offer. That is quite a challenge!) If you take time to look out ...

I was looking at the bench outside the village hall on Saturday evening as the local youth gathered, thinking how the faces change but the attitudes remain the same. The mood changes from bored, to sad, to rowdy, to occasionally menacing. Occasional trips to the local stores ensue, where their older siblings are often employed. Which brought to mind an article by up-market columnist Tyler Brûlé in which he discoursed about the bench outside his shop in Marylebone high street; how it activated the street and created a sense of community. He wrote: "One of the most valuable lessons we’ve learned since moving into the shopkeeping business last November is the importance of offering people a place to sit. The addition of a simple teak bench in front of our London shop a month ago has revealed a number of interesting facts about human behaviour and modern urban planning. The first is that the sheer number of men and women – both young and old – who take up a place on the bench to rest ...

The Independent Achievers Academy, which my company promotes, unveils its Top 100 local shops list this week. Mailings are on their way to the shops that have made it through the mystery shopping stage of the Academy and the winners are encouraged to get their local media involved in telling their shoppers the good news. Telling the good news is important on a number of levels. Just as buskers have to leave a few coins in their hats so that people know it is OK to like the music and contribute, so telling your local community about your success is important as it encourages your shoppers to feel good about liking you, your staff and your shop. Hopefully they will also tell their friends and you will get more shoppers. Getting good publicity is also good for you in terms of building supplier confidence. Just as the government constantly hears from the lobbyists of big retail, so too your suppliers. The more that you can do to show the true picture, the better the outlook for your b...

As the Liberal Democrats are meeting in Bournemouth, it is worth looking at the thoughts the party has put into its Are We Being Served? policy paper, which covers services from local shops as well as from government, supermarkets and utilities. The party's thinkers outline five visions: a fair marketplace; responsiveness; informed choices; consumer protection; and effective redress. Change, the party says, has hit hardest people who are old, who are in poverty or who live on benefits. People without education are being excluded from markets. The policy paper is about ensuring that most people are able to buy what they want easily, efficiently and on fair terms. It looks at food labelling in particular, saying the party wants it to state the country of origin and not of manufacture, that it wants on system of labelling for nuitrition advice and so on. And the paper also suggests that there should be a compulsory "local competition" test for all planning applications for n...

It says in the marketing blurb that Random House printed more than six million copies of Dan Brown's latest book, which went on sale last week. It says here that Asda is selling the book at £5, making a loss of £4 on every copy that it sells. It says in my newspaper that one million copies were sold on the first day of publication. This is the kind of retailing madness that overexcites marketeers and makes people want a share of the action. For local shops this is the kind of event that often passes them by. For weeks, you may have been walking past clever promotions by multiple retailers trying to persuade shoppers to pre-order. I was passed by two the other day, passionately weighing up and discussing the prices on offer. It was cheapest the place we went to first, they agreed, shoulders sagging at the thought of trekking backwards. Most local shops are in the business of creating frequent small purchases. The blockbuster does not necessarily fit easily with this. But as some poi...

With a bricks-and-mortar store, where you locate is a big decision, fixed by your capital investment. On-line, location can be changed at the click of a button. I have the opportunity to move to a new space on the betterretailing site that will be launched later this month. The benefits will be that this blog will appear alongside others that will tackle different aspects of strategy and tactics for local retailers, including a new blog by Steve Denham. It is exciting for me and should help readers find even more good stuff, near at hand. I am also looking forward to coaching from Sam on how to make these short items even more useful, such as embedding links. Just as retailers may benefit from a good mix of footfall driving shops near them, so too on the web. Fingers crossed.

Local retailers must keep on promoting seasonal events, says Watton, Norfolk retailer Chris Edwards. Don't give up because you think supermarkets have taken all the trade. Stay in there and get some of it. Great attitude. What can you learn from it?

Andy Bond runs Asda, the UK arm of Wal-Mart, and recently agreed to a lengthy interview with the Financial Times newspaper about his views on whether he was the right man for the Marks & Spencer top job. I find it hard to believe that his US employers would be happy for him just to chew the fat with a newspaper about his career options so it was interesting to read what else he was talking about. So when he says that 2010 will be a tough year, he must be talking to someone other than his shoppers. He notes that the 2.5% rise in VAT and other tax increases in the pipeline will be putting presure on the amount of money that households have to spend. Is it a message to suppliers that they will have to trim their prices so that Asda can cut the cost of its products to shoppers? Probably. For many local shops, an upward nudge in January is possibly being pencilled into their business plans now. But don't assume that the multiples will make it easy for you. Think about how it will lo...

Nine out of 10 staff working in local shops feel uncomfortable asking shoppers for proof-of-age, trade magazine Retail Newsagent reports. As local shops depend on sales of price restricted products for footfall, this must represent a lot of unhappiness. The solution, expert Mike Denby suggests, is to train staff. Your people know the law, he says, but they often do not know the consequences of not following it. Context is always important. You need to coach your people in what could happen to your business and their job if they serve under age people. Good local retailers have a process: they teach new staff the rules, and the refresh all staff at regular intervals. Create an environment in which your staff can be successful. The more confident they are, the fewer problems they will face in asking for proof-of-age.

It says here in an advertisement by Nescafé that shoppers who buy a hot beverage in store are more likely to buy into other categories and spend more than other shoppers. The figures Nestlé quotes are that they will buy 4.8 items per trip (versus 2.8) and spend £10.47 versus £5.10. Surely it must be worth taking five minutes out and doing the sums for your shop. (Pity the Nescafé ad is silent on the margin potential!)

From the US we now have the concept of the smart shopper who will not spend, spend, spend on credit cards but will save up for major items. This shopper looks at price and value and quality, says Mike Duke, chief executive of Wal-Mart. One outcome is that US shoppers are using cash more and credit cards less, which is a big reversal of shopping trends if it continues. Thinking about price and value and quality, most shoppers build an approximate idea of what they are looking for and are quite imprecise at the point of sale. Mr Duke is obviously building up a picture of a shopper hot-wired to Wal-Mart values and paying less attention to his list of attributes. Value, we know, is what is left over when you take away the product (or service) experience from the price paid. If the product over-delivers, that creates value. If it under-delivers that destroys value. Price, we know, is also hard to pin down. Most local shoppers will buy bread and milk but they would struggle to tell you ...

Mike Southern in his weekly column for entrepreneurs says the best way to improve your guanxi is to always treat people like you would want to be treated, to help people wherever possible and to always tell the truth. Guanxi is a Chinese word that equates to well-being and true status. Money is what you have in your bank account, Mr Southern says. Wealth is what you have if your money suddenly vanishes: your knowledge, your reputation and network. For local retailers, as with all business people, these are useful ideas to benchmark what you are doing. Don't just think of it in terms of shoppers that visit your stores. Think of it also in terms of your suppliers and competitors.

Arthur Ryan, the secretive Dubliner behind the success of the Primark chain, is standing down this week and a tribute in the FT at the weekend lauded a "veteran trader who redrew the face of the high street". An analyst even provided a quote that suggested he had managed to keep all the people happy all of the time. I first came across Penneys - the Primark brand in Ireland - in the 1970s and used to buy cowboy boots and jeans there. They were cheap and cheerful and worked. In Primark, the sorts of things that I like to buy are t-shirts and underwear, summer casual clothes and so on. However, one of the secrets to shopping in Penneys/Primark was always to work out when the shop was not full and how to do returns. The canny shopper with time on his or her hands could make the cheap prices work for them. Today, I simply cannot bear to wait in the queues for the tills. While most retailers seek to reduce queues, in the case of Primark the queue may be part of the package. ...

Shopkeeping is a passion of mine, Theo Paphitis, owner of Rymans, the office supplies company and UK TV star, told an audience of leading retailers last week. The simple act of owning a store provides you with 70% of the skills of running a business, he estimates. The reason why is that running a local shop requires a huge mix of skills: people skills, stock control, merchandising, and so on. Shopkeeping is also an area where you can join with no qualifications and get to the top. Cheerleading for the retail sector is important. Retailing done well adds value to the economy. Mr Paphitas is right to say that anyone can open a shop. But to do it well you need to master a broad set of skills. The good news is that there is lots of help easily available to the local retailer prepared to make the effort to seek it out.

Margate retailer Hina Olive told Retail Express a year ago about her training plans and the trade newspaper returned this week to ask her how things are going. Well, she reported. She is nearing completion of a level 3 NVQ and one of her staff has passed at level 2. Retailers in the UK are taking training seriously and with the support of Tesco, Sainsbury, the John Lewis Partnership, Kingfisher (which owns B&Q) and others, the quality and focus of training has improved greatly in the past five years. Part of the secret is that retailers have worked hard to benchmark their training so that their staff get recognition that is transferable. Independent shops can benefit from this, as the energy that the major retailers put into getting the direction and quality of training correct means that staff learn useful, actionable skills. The major retailers say that the benefit of training is better customer service and this shows up in the bottom line. For a local shop, the benefit of su...

Kraft's bid to take over Cadbury sees the newspapers producing short biographies of the key players. Kraft's chief executive Irene Rosenfeld is famous for Bagel-fuls, frozen bagels filled with cream cheese, and Oreo Cakesters, soft versions of the biscuits. Local shops are full of products like these, some of which take off for a short time and some of which develop new categories. Mostly, as independent retailers you have to trust the big manufacturers to get their product development right. What you need is for them to generate some shopper excitement, to get your shopper's changing their habits in a way that works for you store. Serving coffee is one category that every local shop should try. The owners of the Costa brand report that their sales continue to rise. It is recession-resilliant, they say. Just as Kraft makes progress by helping people eat their bagel quicker, you make progress by putting a beverage next to the newspapers and cigarettes.

In a bid to encourage banks to lend, Sweden has set a negative interest rate for cash deposits from banks. The banks will have to pay the equivalent of 25p per £100 to keep their money with the central bank. Local retailers in the UK will know what this feels like as the cost of depositing cash has risen sharply. One retailer I spoke to this week said his charges have risen from 15p per £100 to 45p in the past two years; and now he sees other banks advertising rates at £2. All this makes it attractive to have a self-fill cash dispenser in your shop or even to offer cash back at the tills. To most shoppers, cash back at supermarkets feels like a benefit. Few understand that it is saving the supermarket money. Few consumers understand that handling cash and moving cash costs money. If you are geared up to accept debit card payments, you should think about offering cash back at the same time.

Local news retailers in the UK accept a huge numbers of vouchers for newspapers and magazines yet the industry still fails to observe clear standards on how to produce them. As a result, for many local retailers vouchers look like risk rather than cash. Four out of 10 refuse to handle them. For publishers, the purpose of vouchers is to win greater sales. However, independent retailers argue that supermarkets don't care what they redeem vouchers against and have the market muscle to force publishers to pay. If publishers are paying for shoppers to buy other products in multiple outlets, that further damages their investment in the independent channel. Surely it makes sense for publishers to set standards for vouchers that encourage independent retailers to accept them? says Hinkley retailer Mike Hopkins.

Accepting debit and credit cards requires some good internal disciplines and while many local retailers are put off by the costs that they will incur, perhaps they should do the maths. A Wiltshire retailer I talked to today told me he charged 25p on every debit and credit card transaction. He put a clear sign up by his till, explaining this, and created a barcode that is scanned for each transaction. No shopper has ever complained, he said. Another retailer, from Derbyshire, said he charged 75p on any transaction below £10. No-one had ever complained, he said. If clearly stated, the proposition is clear and your shoppers have a choice. The shopper benefits from the convenience and you benefit on the bottom line.

On 1 January the rate of VAT in the UK is set to go up by 2.5% after the temporary cut to see us through the Crunch. Many local retailers may not have cut their prices and this is the end of a very handy extra 2.5% margin. But they need to think now what they are going to be doing in January. It is clear that the multiple retailers are all planning now. City analysts say they are well placed with lower stock levels and clarity about what shoppers are thinking. Lower mortgage costs mean that many families have had more money to spend each week - around £12 a week in June and £9 in July. If shoppers feel that the Crunch is not so bad, then they may be tempted to spend a lot before Christmas. Analysts say that retailers will be promoting hard. However, they also say that the multiples will be pushing prices up in the background. "With list price increases to more than offset the cost of higher promotions, customers may not be getting quite the bargain that they think," says Andr...

Standing in a bric-a-brac shop yesterday, talking to the owner, my eye caught sight of an old Coca-Cola sign with a £48 price tag. His shop is filled to the brim and beyond with stuff. People drop in off the street to browse. Sometimes they buy something. Mostly they leave without buying. It is the opposite of the modern convenience store. What are shoppers looking for? Something valuable that my friend has not noticed? Something to complete their mantlepieces? Props for stage set? A gift for someone who has too much new stuff? He knows his proposition. He buys stuff that looks like someone might value it and then hides it away on shelves filled with often unrelated stuff. Shoppers with time to kill are happy to hunt it out. What do you have in a convenience store that provides the same joy to your shoppers? Perhaps nothing. Perhaps your magazine range? Perhaps you greetings cards?

Local shops with PayPoint terminals could have a new group of customers shortly. This is because the payment service provider has signed a deal with the UK Ministry of Justice so that people can pay fines for some driving offences, for being drunk and disorderly, for vandalism and similar at PayPoint outlets. Initial reaction from retailers has not been warm. Heather Dunn of Keswick told Retail Newsagent : "I really don't see how offering another low-margin collection service is going to help." Ever since the lottery launched in the UK with its 5% retail margin, retailers have suffered from service providers treating this a benchmark. What other service providers may not appreciate is the lottery comes with great emotional baggage. People are buying a dream! Retailers want shoppers to buy dreams in their shops. Major suppliers recognise this and are spending more on point-of-sale solutions as researchers find that the scribbled shopping list is used less and less and...

Always fresh is the motto of Canadian food-to-go outlet Tim Hortons. This means it changes its coffee every 20 minutes, even if the pot is full. But it also means, says chief executive Dan Schroder, that: "You're changing all the time...always fresh washrooms, parking lots and products." I visited one of his outlets outside Toronto, where we discovered Timbits, its mini donut balls, and where the counter was pristine clean glass and steel and the staff were crisply attired. The Timbits stand out in my mind as the remarkable part. Mr Schroder is building his business on freshness. To be better than other outlets at delivering freshness he needs to get his staff to buy in to keeping things 100% and to get his business processes right. But perhaps the magic of his business is elsewhere. As the chain seeks to expand it sponsors local childrens sports events, using the Timbits brand. The freshness may get you noticed but the fun may be what is needed to get you coming ba...

In all businesses it is fairly easy to calculate the hypothetical profit margin that you could make but the important thing is to work out the actual profit margin that you do make. In a shop, work out the average daily running costs and then take this away from takings and you have a basic measure of profit. Where it gets interesting is when you try to work out which parts of your business are delivering the profits. For many businesses, putting in place the processes to break down and measure profitability is a big task. Starting from scratch, you have to think hard about where costs should be allocated. You then have to work out what the actual sales figures really are. In retailing, many retailers make the mistake of focusing on mark-up and forgetting rate of sale. If you have a product with a 100% mark up that sells once a week, you may find that a product with a 20% mark up that sells 100 times a day is the real profit generator. The process of finding out is also good for ...

Fresh and chilled foods are the categories where there is a huge divide between independent and multiple shops in the convenience market. Fresh and chilled is a big profit opportunity but doing it well requires a different skill set to selling soft drinks, snacks and confectionery. Speaking to trade magazine Retail Newsagent this week, Booker chief executive Charles Wilson advises: "Get the milk, bread and cheese right because most of the volume and value is in that area." There are two parts to his advice which are helpful. Firstly, the need to focus and to set standards and achieve those standards. Second, that to transform your local shop can involve incremental steps. Break down your move into new areas into small, bite-sized chunks and work your way up to a full fresh and chilled offer by increments. Getting shoppers used to buying bread and milk in your shop will get them thinking about picking up a basket, which is when you break through to the next level in conven...

The UK's magazine market has been under investigation by the Office of Fair Trading, the UK's competition watchdog, for many years. A recent ruling on the acquisition of the UK's largest magazine wholesaler Smiths News of assets formerly owned by the former number three wholesaler Dawson News makes interesting reading. To make a judgement, the OFT assesses the supply of services to the publishers, which is paid for by a proportion of the cover price and includes delivery of titles and handling returns. And it assesses the supply of services to retailers, which is paid for by carriage service charges, for the right to receive deliveries. As many retailers challenge the back-door way that CSCs were introduced and expanded in the 1990s, it will be interesting to see if this distinction is allowed to go through unchallenged. More interesting is the OFT's concern that if Smiths did not complete the acquisition then some retailers could potentially have been left without su...

Another great question to ask yourself, borrowed from Bronek Masojada, chief executive of insurer Hiscox: "What do we need to do to make this business work really well?" Use this as you walk towards your shop in the morning. Use it as you walk the floor. Use it as you buy from suppliers. Use it after work when you think about the next day.

Bill Gammell, who runs Cairns, a small oil company sitting on large oil fields in Rajasthan, told the FT this week: "Independents recognise that because they are not one of the big boys, they start with the humility to understand that they cannot do everything, and they need people to help them with what they are doing." Two ideas. Focus on what you are good at. Ask for help. Works for local shops too! Cairns was nimble enough to do the deals that made its development a success. Where can you be nimbler than the multiples? Who do you need to ask for help?